Both operating income and net income were below market expectations. The company blamed the lower profit on the strong won and a strike in the third quarter that interrupted vehicle production.

South Korean exporters are feeling the pinch of the local currency's rise that began in the fourth quarter of last year. Its bigger affiliate, Hyundai Motor Co, also saw its profit fall despite a rise in sales. Samsung Electronics also expects a negative impact from currency-related losses.

Kia Motors gave a dim outlook for 2013, citing weak demand at home and the local currency's continued rise against the US dollar and Japanese yen.

Even though the company expects to see a moderate increase in annual car sales this year to 2.75 million vehicles from 2.72 million in 2012, more than two-thirds of its products are sold overseas.-Reuters